Finally the whistle has blown on the construction work and this week saw London’s new Wembley Stadium open for business. Amongst much fanfare and hoo-ha the UK’s icon of international football has at last hosted its first game. The stadium was however, delivered over a year late at twice the estimated budget and has been immersed in bitter controversy since its concept. Do we just have to accept that we are not capable of accurately budgeting for large projects?
The painful birth of this large venue, set against the backdrop of the huge 2012 Games budget row, does not bode well for the reputation of the UK construction industry. So why do we get it so wrong? Stadiums have been built before… should we have not been able to forecast the cost within the accepted limits?
Of course as any London taxi driver will tell you, and rest assured they do, it can be done, the Emirates football stadium, also in London and even by the same designers and builders, HOK Sport and McAlpine was delivered on time and on budget. But let’s not underestimate the achievement of Wembley. This project by any standards is huge. Catering for 90,000 spectators it (importantly) has no less than 60 bars and (even more importantly) has 2,618 toilets which apparently had to be flushed simultaneously as part of the testing.
So litigious was this project that most of the companies involved have long since ‘clammed-up’ with a barrage of ‘No comments!’ being received from all parties. This was no doubt a result of the extremely acrimonious court case that virtually brought the site to a standstill. The rumoured opinion on the Wembley cost overrun is that the client (Multiplex) moved the goalposts during construction (sorry). This happens on all projects so we must assume from this that an inadequate change management mechanism was in place..?
So what hope for the London 2012 Olympics which is already running at three times the estimate before work has even started on site? Certainly on this one we fell at the starting block with a bid of £2.4bn when 8 years prior, the Athens Games had cost £6.3bn. With no hope of extending the timeframe, the cost can only go up from the current $9.3bn as pressure increases onsite and money gets thrown at the project in the form of overtime and penalty charges. So out-of-control is the London Games that the current contingency of £2.7bn is actually higher than the original bid (£2.4bn).To put this in perspective, this figure is higher than the GDP of Zimbabwe. And that’s just the contingency! In my days a contingency was 10-15% not this staggering 50%.
But what about the wider issue of legacy ? This is the hotly debated subject now and is a great tool for blurring the budget boundaries. The organisers and pro-Games camp are arguing vigorously that London will see a lasting benefit from the development. Again looking at the previous experiences does not look encouraging. Only Barcelona in the last two decades can genuinely claim a lasting non-sport benefit from its role as host.
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